Bulletin: Focus Financial Partners Inc.'s Leverage Could Rise If The Company Is Taken Private

NEW YORK (S&P Global Ratings) Feb. 7, 2023--S&P Global Ratings today said it anticipates Focus Financial Partners Inc.'s (BB-/Stable/--) leverage could rise if the company is taken private. On Feb. 2, 2023, Focus announced an acquisition proposal from Clayton, Dubilier&Rice. If Focus is taken private, we anticipate the company's financial policy could become more aggressive, leading to leverage above the 3.5x-4.5x target range it has maintained as a public company, which could negatively affect the rating. The wealth management industry remains highly fragmented with a handful of larger firms rapidly acquiring registered investment advisers. Acquisition multiples remain high, and peers such as Hightower, Mariner, and CI Financial have increased their leverage significantly in recent years to support growth.

...February 7, 2023 NEW YORK (S&P Global Ratings) Feb. 7, 2023--S&P Global Ratings today said it anticipates Focus Financial Partners Inc.'s (##-/Stable/--) leverage could rise if the company is taken private. On Feb. 2, 2023, Focus announced an acquisition proposal from Clayton, Dubilier & Rice. If Focus is taken private, we anticipate the company's financial policy could become more aggressive, leading to leverage above the 3.5x-4.5x target range it has maintained as a public company, which could negatively affect the rating. The wealth management industry remains highly fragmented with a handful of larger firms rapidly acquiring registered investment advisers. Acquisition multiples remain high, and peers such as Hightower, Mariner, and CI Financial have increased their leverage significantly in recent years to support growth. We think that as a private firm, Focus may employ higher leverage to remain competitive. While our rating on Focus is currently unchanged, we will continue to monitor...

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